188. Trump Declares War On His Own Party

14:22Katty Kay:It's a really good point. And the question is, it's two years from now, will he still have this influence?

14:27Anthony Scaramucci:He'll still have the money. He'll still have the money. Okay.

14:30Katty Kay:We've moved on from role playing. Okay. We're now into the game show phase of the rest of politics, you ask. And so I'm going to read something to you and you're going to say, yes, that works or no, that really doesn't work. Do I get points or something?

14:45Anthony Scaramucci:I mean, is there like, what's the bonus? I need an incentive structure here.

14:49Katty Kay:We'll have a product gift certificate at the end of this. Excellent.

14:52Anthony Scaramucci:Okay.

14:53Katty Kay:Okay. All right. You're ready? So this is the Massey campaign. Okay? Yeah. And this is in the final, let's say 96 hours. This is the closing arguments. And I want you to say, this works, ah, medium, or this does not work. Okay. You ready? Billionaires are trying to buy my seat. He went on Stephanopoulos on Sunday and he named everybody, including AIPAC. He says, this is out of state billionaires buying your congressman, KY04. And you say, yeah. That doesn't work so well. All right. It doesn't work. You're so British. For those of you listening and not watching YouTube, she put up the middle thumb.

15:35Katty Kay:The middle thumb. Okay. Which is like sideways thumb, but she really knows it doesn't work. So I'm giving two thumbs down on that one.

15:43Anthony Scaramucci:Everybody knows there's tons of out of state money coming into these races. Okay.

15:47Katty Kay:Be a little less British when you answer the next question. All right. This is for the Prada gift card. Okay. You know how to win me over. Weaponizing Trump's attacks for fundraising. Every time he tweets about me, it's good for me. There's some money coming in. We're converting Trump's truth social posts into small dollar halls in real time. You really believe that? Okay. Yeah. That's not working either, Congressman Massey. Okay. Let's go to the next one. Okay. He's introducing the AIPAC Act and he's saying this mid-race that he would like AIPAC to have to register as a foreign agent. And I just want to point out that these are US citizens, mostly Jewish citizens, but frankly, some people that donate to AIPAC are non-Jews, but they're US citizens in an American political action committee.

16:42Katty Kay:But he says since they're supporting a foreign country, he wants them to register as a foreign agent. Okay. And this is his middle finger against them, frankly. And they're trying to silence me. Is that working on the 776 ,000?

17:01Anthony Scaramucci:It may work if he was running in the great state of Michigan. However, he is running in Kentucky, and so I'm going to give that a thumbs down too. So he's not doing too well, Mr. Massey.

17:11Katty Kay:Okay. We got two more, Katty K. Surrogate Strategy. He's got Rand Paul and the podcast Right, and they're coming in state as validators. And he's also was hosted by Tucker Carlson, And he's got Mike Cernovich and other what I would call broader MAGA, broader traditional MAGA, Marjorie Taylor Greene MAGA.

17:40Anthony Scaramucci:This is not going to help him because these people are already labeled as anti-Trump. That's the problem. If he's trying to broaden his appeal. So who is he trying to get? What's going to make the difference for him? The difference for him is going to be whether a few Trump supporters decide to jump ship. Well, that's kind of unlikely to happen, I guess. Or he can get out more Massey supporters, right? He's actually got to drive more of his own people to the polls. He's not going to win over Trump supporters. I don't think at this stage they know who he is. They know that Trump hates him. So he's got to drive up his supporters.

18:19I don't know that he does that by going on Tucker Carlson, and I don't think that's going

18:24Anthony Scaramucci:to help very much.

18:26Katty Kay:All right. Well, you've given a couple of thumbs down, a couple of neutrals, but no thumbs up of discernible. I didn't see any of these, Katty K. No thumbs up. Okay. And so he really wants to win. What did he need to do? He needed to soften his stance on the Epstein files, which he's not doing. He needed to soften his criticism of the Iran war and the connection into Israel, which he's not doing. He also needed to go have a rapprochement with Donald Trump, which he's not doing. Now, he is running as a fiscal hawk and anti-interventionist and all that other stuff, which sounds good, but the people are tied to Donald Trump, Caddy, and we have to accept that.

19:12Anthony Scaramucci:Yeah, but let's take the alternative route, which is driving up his supporters, right? He's got to get out more Massey voters and more people who are skeptical of Donald Trump. So I'm not sure that going to have a rapprochement with Donald Trump would help that particularly. to leave.

19:28Katty Kay:Obviously, it's too late for that, but I'm saying - It's too late for that. I'm saying six, eight months ago, knock, knock, Tom Massey, listen, Trump's going to be gone in two years. You could be here for another 20. Go break bread with Donald Trump. Okay, he did not do that, but there's lessons here. I just want to say these two quick things. The full-on narcissist, Donald Trump, doesn't care about the power structure in the Congress. He cares about his personal power over those Republican congressmen. Because a smart president would be like, all right, this guy disagrees with me. I'm going to help him anyway, Bill Cassidy.

20:04Katty Kay:I'm going to help Massey anyway, okay? Because they are good Republican citizens, right? The Epstein files, ha ha, I control the Department of Injustice and they're not coming out. And anything I did that was untoward in the Epstein files. No one's ever going to see the daylight of day anyway, Tom Massey. So you're barking up the wrong tree, but you're a good Republican. I'm going to let you back in the Congress. No, no, no. I'm a supreme narcissist and this does not bode well for the Republicans. And if I was Gavin Newsom listening in, I'd be saying, okay, we got these guys. If I can just figure out a way to consolidate the Democrats and get them to stop bickering with each other.

20:48Katty Kay:If it's not Newsom, you pick the person, Katty.

20:51Anthony Scaramucci:Because Trump is making it all very personal.

20:53Katty Kay:Exactly.

20:54Anthony Scaramucci:This is not about actually the health of the party.

20:57Katty Kay:That's hopefully where the Democrats will look at it and say, hmm, this is where I got to lock on the target. One other thing, which is more evidence to the weakness of what Trump is doing, he knocks Tillis out. This is the senator from North Carolina. He knocks him out and says he's not going to run anymore. He picks Michael Watley to replace him. Watley wins the primary, but he's now facing Roy Cooper, a very popular Democratic governor in November. So this is a race that the Republicans could absolutely lose, whereas Tillis would have been the resounding favorite to win in November, so much so that Cooper may not have even ran.

21:41Katty Kay:So I just want to point out some of the externalities of what Trump is doing. that is actually hurting the party.

21:48Anthony Scaramucci:I think it's actually hurting the party beyond that, because even when these Republicans win, as in the case of Louisiana, the woman who is running against Bill Cassidy, she'll go on and win that because Louisiana Republicans always win those Senate seats. But what he is doing by doing this is he's prolonging the Trumpism of the Republican Party. So even once Trump has gone from office in 2028, he has set in place a system in places like Indiana, in places like Kentucky, in places like Louisiana, in places like South Carolina, where the quality and nature and politics of the Republican Party is going to be far more Trumpian than it would have been if he hadn't got personally involved.

22:31Anthony Scaramucci:Before we go to a break, there's one Republican I would like everybody to take a look at. It's an article that David French wrote in the New York Times, Republican columnist in the New York Times, not a great fan of Donald Trump's, but it's really worth a read. We'll put it in the newsletter for you guys. But he is telling the story of the Republican majority leader of the South Carolina Senate, Shane Massey, who stood before his colleagues and gave a speech which is brilliant, a brilliant defense of America's democratic principles and founding ideals and why this whole redistricting thing. And he's a very conservative Republican and he will lose his seat because of this, because Donald Trump will do to Shane Massey what he has done to Bill Cassidy and what he has done to Thomas Massey in Kentucky, and he will go after him and there is no way he'll be able to hang onto his seat.

23:21Anthony Scaramucci:He will be like those Indiana Republicans, but it's worth a listen. It's worth 10 minutes of your time just to listen to this speech about how America needs to defend its actual ideals of democracy and giving people a real choice in their votes. So if you want something a little uplifting, read that or listen to that. Listen to it is even better because it comes with that lovely South Carolina accent, you all, which I can't do.

23:46Katty Kay:Unfortunately, I can only do one accent, Katie. That's just, that's long guy land. Long guy land. That's my only accent.

23:53Anthony Scaramucci:We're going to take a break and come back and talk about oil prices.

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25:32Katty Kay:Welcome back to The Rest is Politics US. Caddy, tickets are on sale now. You go to therestispoliticsus.com. We're going on tour in October. What are some of the cities we're visiting, Caddy?

25:44Anthony Scaramucci:We are going to Chicago, Minneapolis, Atlanta, Boston, New York, Washington, D.C., and heading up to Canada to go to Toronto as well. Please come and see us. We'd love to meet you guys. We haven't really done a proper North American tour. So this is a bit of a first for us. And we would love to see you and get you guys all to chat to each other and throw us some questions too. So we're looking forward to it. And we'd love to see you there. Please do buy some tickets.

26:11Katty Kay:So Katie, I have a question.

26:13Anthony Scaramucci:Go on.

26:14Katty Kay:And I want you to answer this question because you're an incredibly smart person. I did a little bit of math over the weekend, talked to my economic analyst at Skybridge. And we're going through the damage. Okay. And I want to step back and say that the US has spent, they're lowballing the number. It's not probably a billion dollars a day, but they probably spent$50 billion to$60 billion prosecuting the war. It turns out the damage that was done to our bases in the area are now being estimated because you look at satellite imagery, the bases look wiped out,$5 to$8 billion worth of damage, Caddy, to the bases.

27:00Katty Kay:Then you've got damage done to the Gulf states. We're talking about$30-ish billion worth of damage there. And it looks like we have about$600 billion of damage to the global economy, meaning the economy has grinded down and growth has gone down globally as a result of this. And so I'm rounding numbers to say this is a$700 billion economic catastrophe. No Democrat that I've heard of has framed it from that perspective. Nobody has said, hey, I'm just letting you know, we had the JCPOA and we were in the process of removing their nuclear threat and seeing if we could reintegrate this nation back into the family of nations, but we ripped that up and we've dropped these bombs on them now and we now have $700 billion worth of damage.

27:58Katty Kay:And again, we're probably not going to even get the deal that we once had. And of course, you guys talked about Robert Kagan last week, but go ahead. So why is nobody talking about that if you're in opposition of Donald Trump? The president, by the way, because I know his personality, if anybody framed it like that, whatever hair is left on his head, because if you saw that picture of him in China where the hair was blowing all over the place, whatever hair is left on his head, he would burn off the top of his head if anybody framed it like that.

28:25Anthony Scaramucci:I think the challenge for Democrats or for anybody is to frame this in numbers that mean something to somebody.

28:31Katty Kay:By the way, before you answer that, I still want to point out that this is a calculation we're making. These figures obviously could be in dispute, meaning the Pentagon would say differently and maybe President Trump himself would say differently. I'm just doing this back of the envelope economic analysis. But go ahead, Kat. I just want to make sure I put that buffer in there.

28:51Anthony Scaramucci:There's another set of numbers that's just come out. Brown University's Watson School of International Public Affairs has just estimated the conflicts hit to American consumers just in terms of higher petrol and diesel prices. And they came up with this weekend the number of$41 billion. dollars. Per consumer, per American household, that's$316. And I think that's actually the way to make these numbers break through. Because if you say, well, the war has cost the global economy $700 billion, the average American voter in my household, I don't really know what that means. That's a lot of numbers with a lot of zeros at the end of it.

29:30Anthony Scaramucci:If you go and you say to consumers, it's cost your household$316 so far, just in terms of higher gas prices, that is something that people can actually understand. But here is what the FT did over the weekend that I thought was really interesting. They did a comparison of what could have been done with that$41 billion of extra oil, petrol and diesel prices. They said it could have restored America's bridge programs. It could have completely redone the US air traffic control system. That would have been a mere$31 billion. It could have fully funded the now defunct$18 billion federal electric vehicle charging and electrification programs.

30:12Anthony Scaramucci:So I think that is the way to make this have meaning for Americans. This is what it's costing your household. And this is what this war that has not got rid of Iran's nuclear program, that has not had regime change, that has not destroyed Iran's missile program. This is what we could have done with just one small slice of the money. We could have repaired America's bridges. We could have redone America's air traffic control systems. You know what it's like to fly in and out of airports. There are far too many crashes happening at the moment in America's airports. It needs overhauling. We could have used that money to do that.

30:47Anthony Scaramucci:We could have used the money to actually install electric vehicle chargers, which would make us less vulnerable to fossil fuel shocks around the world. I think that is the way that a smart Democrat needs to start framing this. But the question I had for you, Anthony, is you've been tweeting me, texting me over the last couple of days saying the oil situation is about to get a lot worse. The squeeze is bad for Americans, but it's about to get more intense. I feel like over the last couple of months, sort of since the Straits of Hormuz were shut, that I've seen covers of The Economist or big articles and headlines in the FT and the Wall Street Journal saying oil prices are unnaturally low.

31:28Anthony Scaramucci:They could have been much higher, but the energy shock is really about to hit. There is a real crisis coming. So which is it? Is there a real crisis coming or have we somehow managed to weather this in a way that most oil analysts didn't expect at the beginning?

31:41Katty Kay:So a big shout out to my friends that were celebrating the 45th anniversary of the Goldman Sachs merger with Jay Aaron, which is a commodities firm. Of course, my old boss, Lloyd Bankfine, was at J. Aaron and moved over to Goldman. And so I have a ton of my friends that are in the oil markets. My next door neighbor actually out here on Long Island is a former oil trader. And I would tell you guys that the shortages were there even prior to the conflict starting. Everybody has some emergency reserves, reserves, but the shortages were there. They were then alleviated by the way by unsanctioning some of the Russian and Iranian oil.

32:25Katty Kay:That was the irony of that. They unsanctioned the oil which gave both of those countries more money. Then of course, we alongside of Europe released strategic petroleum reserves to try to reduce the prices in the overall market. Okay, so that to us on Wall Street is a one-time problem solver. Okay, it brought down the spare supply in the marketplace and it actually has hid the deficit that's out there. Okay, so if we can manage to reopen the Strait of Hormuz by early June, probably going to be okay, Kay. We'll probably be able to skate around this if it's a month later.

33:09Anthony Scaramucci:Why is the difference? Because my understanding was that all of the inventory that had been out there before and that a lot of Gulf states had realized that tensions were rising. And so they had actually shipped out even more and you had quite a lot floating at sea too. But you've had the sea buffer has gone because those ships have now landed in port. The inventories have been drawn down. I thought we had shocks hitting at one point. So how do we get through till June that we can manage this?

33:35Katty Kay:So this is a great question. So what ends up happening is you get what oil traders would call some demand destruction.

33:43Anthony Scaramucci:Yeah, which we've seen in Asia already. We're starting to see in Europe.

33:46Katty Kay:Right. Everything you're saying is being offset by some demand destruction. Again, these are rough estimates. This is me over the weekend talking to three or four different oil traders, trying to get a sense for what they're saying. saying, if the Strait of Hormuz could reopen by early June, we can probably skate our way out of this. And again, economic damage has already been done, which I pointed out, loss of GDP, et cetera. But if we go another 28-day cycle, let's say we're in the middle of July, the Strait is still not open, I think you're going to have much higher prices.

34:24Anthony Scaramucci:Why? What's in that 28 days? What's the difference?

34:27Katty Kay:Just the full depletion of reserves and then the US government and others have to make a calculation, hey, if we go into a full-on kinetic global war, I need this oil. I can't give up this oil right now.

34:42Anthony Scaramucci:So America might ban exports, for example.

34:44Katty Kay:Yeah, remember, remember there's consumption-based uses for oil and then there's national defense based uses for oil. The first leg of the Strategic Petroleum Reserve in Europe and the US is for consumption. Let's keep everybody happy. But that second leg has got to be additional conservation caddy because of a national security concern.

35:05Anthony Scaramucci:But am I right also in thinking that even if it opens at the beginning of June, production and transport doesn't get back to normal for three or four months after that, right? Yes. Because those ships that have now sailed off to California carrying oil, they've got to get back to, they've got to finish their journey, come back to the Strait of Hormuz. You've got to ramp up production again. you've got to do all of the safety checks that have been missed while production was not happening it's going to take a few months for for the system to get smooth again the movement of oil around the

35:34Katty Kay:world right yeah yeah listen again it's a problem but i believe that it's a manageable problem so long as the strait is open by early june i believe so so that's three weeks yep i want to give you these stats, okay? There was on February 18th, US government strategic petroleum reserve 415.4 million barrels. This is as of February 18th, 2026. Maximum drawdown capacity was 4.4 million barrels a day, okay? And then of course, it takes about two weeks for that oil to actually reach the markets after the president signs its release. And so you're right, but if I knew that the strait was open, I could release more oil.

36:19Anthony Scaramucci:So long as you were sure that the straits wouldn't be shut again.

36:23Katty Kay:Right. Well, then you'd have to make sure. Exactly right. You could use the SPR as a bandage, okay, to help us cross over. But again, you've got a problem in diesel, you've got a problem in jet fuel, you've got a problem in fertilizer. Helium. Helium. For chips. Pakistan has told people, hey man, if you're going to watch cricket, watch it at home. We already know there are shortages in Thailand. South Korea has announced a five-month restriction on the export of NAFA, okay? And Asia demand is already down by almost 2 million barrels a day, which you pointed out. So we've got a lot going on and it's going to either resolve itself or explode in the middle of the summer.

37:09Katty Kay:And I said this to you a few weeks ago, So I want you to imagine the MAGA person with the hat on and they're grilling hot dogs and in their backyard and they're paying$7,$8 a gallon for gas to fuel that Ford Raptor pickup truck. Not going to be a happy group of people, right?

37:26Anthony Scaramucci:No. And they've already canceled their July the 4th road trip plans and any other driving plans they may have. Well, that puts us on a three-week timetable. And I don't know. We are hearing out of the White House today that Trump's team are looking at resuming kinetic activity against Iran. He has warned today that the clock is ticking for Iran to accept a deal to end the conflict. There doesn't seem to be much indication that the Iranians are keen on some kind of a diplomatic solution. That all seems to have gone fairly quiet over the last week. So I don't know where that leaves us. And I don't see a plan at the moment for us to have resolved this in the timeframe that you're talking about, which is three weeks.

38:11Anthony Scaramucci:But maybe I'm wrong and maybe something will happen.

38:14Katty Kay:No, no. That's why I think it's important to bring it up because it's important. Look, the stock market's doing well. So this group of people in a K-shaped economy doing well, billionaires are having a field day. But the average person is really struggling right now and my buddy Scott Galloway said it better than me so I'm going to paraphrase from him he says not that the people are out of work they're out of work but they can't afford things imagine the anger of that right you're working but you can't afford things yeah I'm working poor caddy and this is the thing that's really got people upset I had to book a ticket

38:46Anthony Scaramucci:from Portland Maine to Newark a one-way ticket it's an hour and a half flight the ticket price is$760. That's insane. For American travel, that is insane. No wonder people are unhappy.

39:02Katty Kay:And again, Americans are used to lower -

39:04Anthony Scaramucci:Much lower prices than the rest of the world.

39:07Katty Kay:I mean, that's basically the benefit of the petrodollar situation. But I think we've now exposed the petrodollar as conditional, right? I mean, people are looking to do RenMB, dominated oil contracts. They've gotten more attractive overnight, by the way. I think everybody knows that. Inflation is back. The numbers are staggering, Caddy. The Fed is trapped.

39:28Anthony Scaramucci:We have a new Fed chair, Kevin Walsh, who was sworn in last week, and he will not be able to bring down interest rates as we had thought he would this summer.

39:36Katty Kay:Yeah, he's in an impossible situation now as a result of all this. So one quick other point, because I was on the phone with Department of Defense. I'm never going to call it the Department of war. A buddy of mine known him forever. He said, you know, if you want to go kinetic in Iran, the strategy would have been to mow the lawn. The mow the lawn strategy will degrade their capability for 10, 20 years to get the bomb. And we'll do the same thing that we did last June. And the strait would have stayed open. They would have been pissed off about it, but they wouldn't have done anything more because they were looking to get sanctions relief ultimately.

40:11Katty Kay:But by going full kinetic, we tripped the switch into doing what Brzezinski had said and others, they'll close the strait. Once they close the strait, there'll be a set of consequences that we really can't get ourselves out of. And so this will be, and I want you to push back on me if I'm wrong, but I predict this will be Trump's legacy.

40:32Anthony Scaramucci:Yeah, I think you're right.

40:34Katty Kay:This will be Trump's legacy that he got us into a quagmire. He was a populist leader who campaigned on ending forever Middle Eastern wars. Americans have been running wars in the Middle East for the last quarter century. And he promised us that he wasn't going to do that, but he's now got us into an unspeakable quagmire. If I'm wrong on that, Gatti, push back.

40:58Anthony Scaramucci:No, I think you're right. I think his legacy is three things. He launched a tariff war, as I said last week when we were talking about China. He launched a tariff war. He alienated America's key allies in Europe by threatening to take Greenland. And he launched an unwinnable war in Iran. And all of those things are hurting him. And because Donald Trump is surrounded by incredibly wealthy people and friends and family who are making an awful lot of money, both out of the market and on their trades on what he's doing, he is out of touch and increasingly shows himself to be out of touch by saying things like, I don't care about Americans' financial situation.

41:38Anthony Scaramucci:And when he's asked about it by Brett Baer on Fox, just at the end of last week, asked again about it, he says, what is his response? Well, the stock market is booming. That is how he sees it. That's the people he's surrounding himself with. So I think he doesn't understand quite how much Americans are hurting because of this war. We're going to leave it there. Don't forget to go and look at therestispoliticsus.com. There you can become a founding member. We'll be talking this week in our founding members episode about America and whether it's veering to Christian nationalism after the big revivalist prayer service on the National Mall.

42:12Anthony Scaramucci:Who is paying for Trump's ballroom? Is Trump's ballroom going to happen? I have a theory about that. And of course, you can also use that site, therestispoliticsus.com to buy your tickets to our North America tour. Thanks, guys. Thanks for listening.

42:24Katty Kay:See you later in the week, guys.